GoPro has announced that Q4 earnings will be lower than expected, forcing it to cut 7% of its workforce.
The action-camera maker initially expected to earn $500 to $550 million in Q4 of 2015, but has just revised that to just $435 million.
This underperformance is apparently down to “lower than anticipated sales of its capture devices due to slower than expected sell through at retailers.” Quite simply, GoPro isn’t selling enough cameras.
As a result of GoPro’s difficult quarter, the company has announced that it’s cutting 7% of its workforce. The company points out that its headcount has grown by more than 50% annually over the past two years.
GoPro’s Q4 2015 performance represents a huge drop from the same period in 2014, when GoPro earned $633.9 million. Of course, in September 2014 it launched the GoPro Hero4. It hasn’t launched a new top-end product since.
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In fact, in 2015, the company’s only offering of note was the Hero 4 Session – a tough mini-action camera that was initially overpriced. GoPro dramatically slashed the price by half in December, but this evidently wasn’t enough to get it back on track.
The company claims that these recent cuts are necessary “to better align resources to key growth initiatives.” One of those initiatives will be the Karma drone, which is set to launch in 2016.